OVERNIGHT MARKETS AND NEWS
December E-mini S&Ps (ESZ14 -0.22%) this morning are down -0.20% and European stocks are down -0.55%. U.S. and European stocks had initially rallied up to 2-week highs in early trade Monday after the ECB said that most European banks passed stress tests, but stocks erased their gains and headed lower after German business confidence slid for a sixth month to the lowest in 1-3/4 years. Asian stocks closed mixed: Japan +0.63%, Hong Kong-0.68%, China -0.91%, Taiwan -0.21%, Australia +0.86%, Singapore +0.11%, South Korea +0.40%, India -0.37%. Japan’s Nikkei Stock Index climbed to a 1-1/2 month high on optimism over U.S. stock earnings and after the ECB gave most European banks a clean bill of health following stress tests. Chinese stocks tumbled as the Shanghai Stock Index fell to a 1-3/4 month low after a Hong Kong bourse operator said that he had no idea when authorities will give the green light for cross-border trading between the two exchanges. Chinese stocks had rallied sharply in anticipation that price discounts versus Hong Kong stocks would narrow with the start of cross-border trading. Commodity prices are mostly lower. Dec crude oil (CLZ14 -0.52%) is down -0.53%. Dec gasoline (RBZ14 -0.48%) is down -0.87%. Dec gold (GCZ14 -0.08%) is down -0.10%. Dec copper (HGZ14 +0.31%) is up +0.07%. Agriculture prices are lower as dry, warm weather in the Midwest over the weekend sped up the pace of the U.S. harvest. The dollar index (DXY00 -0.07%) is down -0.08%. EUR/USD (^EURUSD) is up +0.01%. USD/JPY (^USDJPY) is down -0.26%. Dec T-note prices (ZNZ14 +0.02%) are down -0.5 of a tick.
The German Oct IFO business climate fell -1.5 to 103.2, a larger decline than expectations of -0.2 to 104.5 and the lowest in 1-3/4 years. The Oct IFO current assessment fell -2.0 to 108.4, more than expectations of -0.5 to 110.0 and the lowest in 1-1/2 years. Oct IFO expectations dropped -1.0 to 98.3, a bigger decline than expectations of -0.1 to 99.2 and the lowest in 1-3/4 years.
